Experts have varying views regarding the Life Insurance Corporation of India’s proposal to take over IDBI Bank.
The LIC-IDBI tie up is an “excellent cultural mix,” said AK Purwar. Speaking to CNBC-TV18, the former Chairman of SBI said that LIC’s large resource and IDBI’s huge domain expertise in appraisal of long term loans make the duo a good combination.
Former Banking Secretary R Gopalan disagreed and said that the bank’s appraisal capabilities have eroded over the years. “Unfortunately, that (bank’s appraisal capabilities ) has been getting eroded very badly in the last few years, and therefore if that is the only issue for which IDBI Bank is acquired by LIC, I will have to look at the LIC’s financial health also,” he said.
However, MR Umarji, Former Chief Adviser -Legal, IBA set aside this concern and said that LIC’s long experience in dealing with financial institutions including banks will help them overcome the hurdles. He also added that the only serious issue will be the concerns regarding the protrection of interest of both LIC’s policyholders and depositors in the IDBI.
Here is the discussion between experts from the financial sector conducted by CNBC-TV18.